AOS LLC v. Hruby et al

Filing 36

OPINION entered by Judge Colin Stirling Bruce on 7/28/2014. Defendant's Motions to Dismiss 19 and 32 are GRANTED. This case is terminated. See written opinion. (JMW, ilcd)

E-FILED

Monday, 28 July, 2014 03:36:29 PM
Clerk, U.S. District Court, ILCD

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF ILLINOIS
URBANA DIVISION
___________________________________________________________________________
AOS LLC,
Plaintiff,
v.
SCOTT HRUBY, et al.,
Defendants.

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Case No. 14-CV-3109

OPINION
Plaintiff, AOS LLC, filed its Complaint (#1) against Defendant Scott Hruby on
April 10, 2014. A Second Amended Complaint (#15) was filed on May 5, 2014 and
added Defendant Secure Data Technologies Inc. (Secure Data). Plaintiff alleged a
breach of contract against Defendant Hruby, two counts of tortious interference against
Defendant Secure Data, and civil conspiracy against both Defendants. On May 16, 2014,
Defendant Hruby filed a Motion to Dismiss (#19). Plaintiff filed its Response (#28) on
June 2, 2014. Defendant Secure Data filed its own Motion to Dismiss (#32) on June 19,
2014. Plaintiff’s Response (#35) was filed on June 25, 2014. This court has carefully
reviewed the documents submitted by the parties as well as the arguments advanced in
their pleadings. After its review, this court finds that Defendants’ Motions to Dismiss
(#19) and (#32) should be GRANTED.

BACKGROUND
Defendant Hruby worked for Plaintiff as a Design Architect and Account
Manager. During his employment, Hruby worked out of Plaintiff’s Fenton, Missouri
office. While employed by Plaintiff, Hruby worked throughout central and southern
Illinois.
Plaintiff and Hruby entered into an Employment Agreement on August 30, 2011.
The agreement contained a broad non-compete clause. The agreement also contained a
forum-selection clause, providing:
“In the event of litigation between the parties concerning this Agreement, or
otherwise pertaining to the employment, acts or omissions of Employee, such
litigation shall be filed in the District Court of Johnson County, Kansas, and
Employee irrevocably consents to the jurisdiction of the Court over Employee’s
person and over the subject matter of such litigation.”
On October 4, 2013, Hruby terminated his employment with Plaintiff and took a
job as a Consulting Systems Engineer with Defendant Secure Data. Secure Data, which
is located in Illinois, is an IT solutions provider conducting work similar to that of
Plaintiff.
On April 10, 2014, Plaintiff filed its Complaint (#1) against Hruby in this court,
arguing that Hruby had violated the non-compete clause in the Employment
Agreement by taking the job with Secure Data. Specifically, Plaintiff alleged that
Hruby’s new position included his solicitation of Plaintiff’s customers, and that Hruby
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was using Plaintiff’s information in his solicitations. Plaintiff filed a Second Amended
Complaint (#15) on May 5, 2014, adding Secure Data as a defendant. The complaint
contained one count of breach of contract against Hruby, two counts of tortious
interference against Secure Data, and one count of civil conspiracy against both
defendants.
MOTIONS TO DISMISS
Defendant Hruby filed a Motion to Dismiss (#19) on May 16, 2014. Hruby
argued that the Second Amended Complaint should be dismissed as it pertains to him
for forum non convenience. Hruby’s argument was based on the fact that the
Employment Agreement between Plaintiff and himself contained a valid forumselection clause dictating that the litigation be brought in the District Court of Johnson
County, Kansas.
Plaintiff filed its Response (#28) on June 2, 2014. Plaintiff did not dispute the fact
that the Employment Agreement contained a valid forum-selection clause. However,
Plaintiff argued that the inclusion of Secure Data as a defendant made this an unusual
case warranting the defeat of the forum-selection clause. Specifically, Plaintiff argued
that the claims against both defendants should not be severed and, based on the facts of
the case, Illinois was a more appropriate forum than the District Court in Kansas.
Defendant Secure Data filed its own Motion to Dismiss (#32) on June 19, 2014.
Secure Data argued that all of the claims in Plaintiff’s Second Amended Complaint
derive from the underlying non-compete claim against Defendant Hruby. Therefore,
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according to the forum-selection clause in the Employment Agreement, the claims must
be litigated in Kansas. Secure Data stated that it has consented to litigate this action in
Kansas, so any argument by Plaintiff that the Kansas court would not have jurisdiction
over Secure Data should be considered moot.
Plaintiff’s Response (#35), which was filed on June 25, 2014, restated many of the
same arguments found in its Response (#28) to Defendant Hruby’s Motion to Dismiss.
Plaintiff argued that the applicable forum non conveniens factors weigh strongly in favor
of action in this forum and against dismissal in favor of the Kansas court. Again,
Plaintiff stated that the claims should not be severed and that the facts demonstrated
that this court was the most appropriate forum despite the presence of a valid forumselection clause in the Employment Agreement between Defendant Hruby and Plaintiff.
ANALYSIS
Both Motions to Dismiss argue that dismissal is appropriate based on the forumselection clause found in the Employment Agreement between Plaintiff and Defendant
Hruby. The Supreme Court recently held that “the appropriate way to enforce a forumselection clause pointing to a state or foreign forum is through the doctrine of forum non
conveniens.” Atlantic Marine Const. Co., Inc. v. U.S. Dist. Court for Western Dist. Of Texas,
134 S.Ct. 568, 580 (2013). In a typical case involving a motion to dismiss for forum non
conveniens, the court must evaluate both the convenience of the parties and various
public-interest considerations. Atlantic Marine, 134 S.Ct. at 581. However, the calculus
changes when the parties’ contract contains a valid forum-selection clause, which
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“represents the parties’ agreement as to the most proper forum.” Atlantic Marine, 134
S.Ct. At 581, quoting Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 31 (1988). The
Supreme Court has held that a valid forum-selection clause should be given controlling
weight in all but the most exceptional cases. Steward Organization, Inc., 487 U.S. at 33.
When a valid forum-selection clause exists, a district court’s analysis of dismissal
for forum non conveniens changes in two ways. Atlantic Marine, 134 S.Ct. at 581-82 (a
third adjustment, not relevant in this case, exists for §1404(a) motions). First, the
plaintiff’s choice of forum merits no weight. Id. at 581. Rather, as the party defying the
forum-selection clause, the plaintiff bears the burden of establishing that dismissal in
favor of the forum for which the parties bargained for is unwarranted. Id. Second,
arguments about the parties’ private interest should not be considered by the court. Id.
At 582. Instead, the court must deem that the private-interest factors weigh entirely in
favor of the preselected forum. Id. As a consequence, a district court may consider
arguments about public-interest factors only. Id. However, because those factors will
rarely defeat a motion to dismiss, “the practical result is that forum-selection clauses
should control except in unusual cases.” Id. Therefore, although it is conceivable that a
district court would refuse to dismiss a case notwithstanding the counterweight of a
forum-selection clause, such cases are not common. Id.
In this case, Plaintiff attempts to argue that the facts make this an unusual case.
Specifically, Plaintiff points to the presence of Secure Data as a defendant. Plaintiff
argues that Secure Data was not a party to the Employment Agreement, so it is not
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bound by the forum-selection clause. Plaintiff further argues that it may not be able to
bring the case against Secure Data in Kansas and, therefore, this court is a more
appropriate forum. Secure Data responded by arguing that it has already consented to
litigate the case in Kansas and that the forum-selection clause should also dictate that
the claims brought against it be heard in the Kansas district court.
Despite the fact that Secure Data was not a party to the Employment Agreement,
there is precedent stating that it can enforce the forum-selection clause against Plaintiff.
“A number of cases say that the test for whether a nonparty to a contract containing
such a clause can nonetheless enforce it (and whether the nonparty will be bound by the
clause if, instead of suing, it is sued) is whether the nonparty is ‘closely related’ to the
suit.” Adams v. Raintree Vacation Exchange, LLC, 702 F.3d 436, 439 (7th Cir. 2012).
After a careful and thorough review of the facts and claims involved in this case,
this court concludes that the claims against Defendant Secure Data are “closely related”
to the claims against Defendant Hruby. All of the claims arise from the underlying
claim that Hruby violated the non-compete clause in the Employment Agreement.
Therefore, based on the precedent cited in Adams, this court concludes that Defendant
Secure Data is in a position to enforce the forum-selection clause against Plaintiff. See
Adams, 702 F.3d at 439.1

This court notes that the close relation of the claims also means that Secure
Data may be bound by the forum-selection clause. See Adams, 702 F.3d at 439.
However, because Secure Data is attempting to enforce the clause and because it has
already consented to litigate the case in Kansas, a finding of whether Secure Data would
be bound by the forum-selection clause if it challenged the Kansas court’s jurisdiction is
not necessary.
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Based on that finding, the only question remaining is whether Plaintiff has met
its burden of establishing that transfer to the forum for which the parties bargained for
is unwarranted. See Atlantic Marine, 134 S.Ct. at 581. After a review of the arguments
made by Plaintiff in both Responses (#28) and (#35) to Defendants’ Motions to Dismiss,
this court concludes that Plaintiff has not meet its burden. Plaintiff has failed to
establish any reason why this case is so unusual that this court should depart from the
general rule that, but for exceptional cases, the forum-selection clause should control.
See Steward Organization, Inc., 487 U.S. at 33. Therefore, because a valid forum-selection
clause exists which dictates that the case should be brought in a Kansas District Court,
and because the case does not present exceptional circumstances, this court finds that
dismissal for forum non conveniens is appropriate. Defendants’ Motions to Dismiss (#19)
and (#32) are GRANTED.
IT IS THEREFORE ORDERED THAT:
(1) Defendants’ Motions to Dismiss (#19) and (#32) are GRANTED.
(2) This case is terminated.
ENTERED this 28th day of July, 2014
s/Colin S. Bruce
___________________________
COLIN S. BRUCE
U.S. DISTRICT JUDGE

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